Letter of comfort concealed Obeid family interests, ICAC told

The son of former Labor powerbroker Eddie Obeid has admitted he asked a lawyer to write a "letter of comfort" to hide the family's interest in a coal-rich area of NSW.

The letter was designed to conceal the family's relationship to an investment company that was involved in tendering for a tenement in the Hunter Region, the Independent Commission Against Corruption (ICAC) heard on Monday.

The ICAC is investigating whether former Labor minister Ian Macdonald rorted the tender process in the Bylong Valley in 2008, and how Mr Obeid may have profited from it.

The ICAC has heard the Obeid family stood to make up to $100 million from the opening up of mining in the valley.

Giving evidence on Monday, Eddie Obeid Jnr conceded that he directed a lawyer to draft a "letter of comfort" relating to a coal deal in the Bylong Valley.

Under questioning from barrister Robert Stitt QC, Mr Obeid admitted the document was designed to hide the Obeid's involvement in the company Southeast Investment Group.

"It's a document designed to conceal, isn't it?" Mr Stitt asked.

"To a degree," Mr Obeid replied.

The ICAC heard the letter was requested by John McGuigan, an investor in Cascade Coal.

Cascade promised to pay the Obeids $60 million to exit their stake in a coal deal in the Bylong Valley, the inquiry has previously heard.

The inquiry was also told on Monday that Mr Obeid owed $3 million to an Obeid family loan account, but had no repayment schedule for the amount, and did not know the interest rate payable on it.

He denied ever seeing confidential government information that was found at the Obeids' offices at Birkenhead Point in Sydney.

AAP

This story was found at: http://www.theage.com.au/nsw/letter-of-comfort-concealed-obeid-family-interests-icac-told-20130211-2e7rv.html